Standard Chartered is again on a buying binge. It has signed an agreement to acquire the entire issued share capital of Chase Manhattan Card Company Ltd (Chase Manhattan Card) and Chase’s Hong Kong-based retail banking business for around $ 1.32 billion.

The total consideration, which includes goodwill of $ 1.01 billion, will be paid in cash and will be determined by reference to completion accounts.

The bank also announced that it has sold Chartered Trust, the group’s UK and Channel Islands consumer finance and contract hire business to Lloyds UDT, a subsidiary of Lloyds TSB Group for £ 627 million in cash.

The acquisition of Chase Manhattan Card will be funded from cash raised from the sale of Chartered Trust and a floatation of new ordinary shares.

Standard Chartered intends to raise around £ 450 million, net of expenses, by placing of 50 million new ordinary shares for cash. The shares issued at a price of 915 pence per share will represent around 4.7 per cent of its current issued share capital.

“This is another step forward in our strategy to become the world’s major emerging markets’ bank,”satd Rana Talwar, group chief executive of StanChart.

The acquisition would also provide opportunity for cross-selling between the two card bases and in marketing personal loans where Chase has pioneered new products and distribution channels, he added.

Following the acquisition, StanChart would have 1.9 million cards in issue and a 25 per cent market share.

The purchase of the consumer banking operations, which has deposits of approximately $ 2 billion, would add four branches, four flexibank centres and forty ATMs, to StanChart’s existing eighty branches and 186 moneylink ATMs, a StanChart release said.

Meanwhile, Standard Chartered has announced that Jaspal Bindra would head operations of the group in India.

Bindra was appointed as regional general manager, India of the group and chief executive officer, Standard Chartered Grindlays Bank. Similarly, Harpal Dugal has been appointed as general manager and chief executive officer, Standard Chartered Bank, India. Other appointments in senior positions will be announced shortly.

Recently, the acquisition of ANZ Grindlays Bank Ltd by Standard Chartered was completed after the Reserve Bank of India (RBI) granted its in-principle approval for the change of the name to Standard Chartered Grindlays Bank.

While the change of name will be effected shortly, both banks will operate as separate legal entities for some time.

Bindra joined the bank in August 1998 as head of corporate & institutional banking. He was also responsible for investment institutions, custodial services and cash management businesses.

After the appointment, Bindra said, “Building the two banking businesses is an exciting challenge and our combined strengths in
treasury, and institutional and corporate
banking will create a client-focused powerhouse.”

On the other hand, Dugal was heading the bank’s consumer banking since April 1999, where he supervised the personal banking and credit card divisions. Dugal said, “We aim to strengthen and significantly enhance our leadership position in consumer banking in India.”

In India, Standard Chartered has 19 branches in nine cities and Grindlays has 39 branches in 15 cities.

PHASE I OF HIND COPPER SELLOFF SET IN MOTION

FROM OUR SPECIAL CORRESPONDENT

New Delhi, Sept 2:

The government has invited expressions of interest (EoIs) from foreign bidders for Hindustan Copper’s two units at Khetri and Taloja.

An advisory consortium comprising Sumitomo Bank and Industrial Development Bank of India (IDBI) will help the government choose a buyer for the copper units which will be sold off as a single company.

The assets of these two units will form a 49 per cent contribution from HCL while the strategic partner selected will bring in 51 per cent stake in cash or new machinery.

Officials of the department of mines said they expected a number of global copper companies
to respond before the expiry of
the deadline for EoIs on October 20.

The government has already decided that the Rs 800 crore HCL will be split into two separate companies before privatising both. Within the loss-making HCL, Khetri and Taloja units are doing relatively better and, hence, are expected to be sold off easily.

In the next phase, majority stake in the remaining rump of the HCL, including the Ghatsila complex also known as Indian Copper Complex, will be sold to a strategic partner.

“We agreed to the disinvestment move because copper prices have shown a falling trend on the London Metal Exchange and are expected to remain low in the years to come. We don’t see any way but privatisation for HCL to come out of the red,” top officials in the ministry of steel and mines said.

The divestment move comes within two years of a Rs 508 crore restructuring package cleared by the Cabinet. This included conversion of a Rs 181 crore loan into a 10-year 7.5 per cent non-convertible redeemable preference shares, a Rs 167 crore interest waiver besides two rounds of funds infusion of Rs 60 crore and Rs 100 crore for expansion cum modernisation and worker separation programmes.

The restructuring plan itself came after HCL ended 1997-98 with a cumulative loss of Rs 169 crore on a turnover of Rs 803 crore.

METAL FAIR TO FOCUS ON EAST

FROM OUR CORRESPONDENT

New Delhi, Sept 2:

The ministries of steel and mines, in collaboration with the Indian Institute of Metals, will be organising a metals and metallurgy trade fair with special focus on eastern India.